WITH a looming — or already existing — recession and an $8 billion state deficit, California faces serious fiscal problems. Among the top challenges for power brokers in Sacramento is how to balance the state budget without undue harm to education, the economy and to taxpayers.

To reach reasonable solutions, thoughtful, fact-based analysis and flexibility will be required. Instead the debate over the budget, particularly concerning education, has been dominated by shrill, self-serving exaggerations about the consequences of reining in spending.

Any statewide belt-tightening is going to have to include public education, which is by far the largest item in the budget. Just how tight education spending should be is open to debate. But arguments that are based on unwarranted fears and an unwillingness to seek innovative solutions are not going to achieve the best results.

Unfortunately, with a few exceptions, the "discussion" over education spending has been unenlightening. What is needed is a more sober look at the situation, which is not as dire as many in the education establishment or legislative leadership have portrayed.

Claims by the California Teachers Association that school spending is going to be cut by nearly $5 billion are not true. If the governor's initial budget proposal, which is sure to be amended, were passed, schools would get $4.8 billion less than they would if there were no budget crisis and Proposition 98 were fully implemented.

However, the actual decline in spending from this year to next is $1.1 billion, or 1.9 percent in overall public education spending. That is hardly an ideal situation, but neither is it a crisis.

Yet, CTA ads all over the media paint a fearful picture of the firing of thousands of teachers, much larger classes and the loss of curriculum. Many in the Legislature are calling for major tax increases to accelerate school spending, without any talk of making some basic reforms that would allow school districts to use funds more efficiently.

One example of how California schools could use money more effectively came from Legislative Analyst Elizabeth Hill, a beacon of professionalism amid the gloom and doom in Sacramento.

Hill said that one basic reform could make up for the loss of $2.8 billion in spending increases without harming schools. She proposes consolidating 43 categorical K-12 spending programs into four grant programs.

This would give school districts the flexibility to spend limited funds in a manner that best suited a particular school district. Too often, mandated categorical spending is inefficient and counterproductive.

In a comprehensive study of state schools by Stanford scholars, district superintendents overwhelmingly wanted more flexibility in spending rather than just funding increases.

Instead of embracing Hill's proposal, the CTA and many legislators so far have ignored it. Instead, they claim that California schools cannot withstand any fiscal restraints because state spending is already near the bottom compared with other states. Some still claim California ranks 49th among the states in per-student spending.

But the facts provided by the Census Bureau, show otherwise. California does spend less than the national average but ranked 29th in per-pupil spending in the 2005-06 school year, the latest in which there are complete statistics. Total school revenues from all sources were $10,264 per pupil, placing California 25th among the states, according to the Census Bureau.

These statistics are nothing to brag about. California remains below the national average in revenues and spending. But the statistics also show that there is little relationship between per-student funding and student performance.

California does need to boost school spending and efficiency over the long run. But for the next fiscal year, our public education system can withstand a 1.9 percent spending reduction without undue harm to students if educators and legislators are willing to employ some innovations like the one Hill proposed and reduce spending on constant curriculum changes.